Apparently I was not the only person to rather take advantage of all-you-can-eat deals, at least in my years as a student. Last month the US restaurant chain “Red Lobster” filed for bankruptcy, in part due to losing $11 million in 3 months associated with its “eat unlimited shrimp” deal. That’s 13 years after it made basically the same mistake with regards to unlimited crab. ,
Marketplace reports that it’s far from the only restaurant to suffer these kind of all-you-can-eat losses.
All-you-can-eat deals have nearly killed a lot of restaurants, Allen said: Olive Garden lost millions on endless breadsticks; Pizza Hut lost big on its endless pizza buffet; Sizzler blamed its 1996 bankruptcy, in part, on people abusing the endless salad bar.
Seemingly these deals are a good way to short-term get punters into your business, but in the end restaurants don’t often have the margins to survive the habits of the people they attract in the longer term.